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Showing posts with label federal reserve. Show all posts
Showing posts with label federal reserve. Show all posts

11/12/11

The money market, open market policy (purchases and sales), in the context of monetary policy

19:03
The money market, open market policy (purchases and sales), in the context of monetary policy

Monetary Policy:

Actions the Federal Reserve takes to control the money supply and interest rates in pursuit of macroeconomic policies.

There are four primary policy goals for monetary policy:

  1.  Price stability (inflation control)
  2. High employment (or low unemployment)
  3. Stability of financial markets and institutions (through regulation and transparency)
  4. Economic Growth (promoting sound investments)

The Federal Reserve tries to keep both unemployment and inflation low, but it cannot affect these